SBDC Business Forum: Stats reveal who's still cooking in the restaurant field

Monday

Jan 21, 2013 at 2:00 AM

I've heard it so many times: "My chicken parm is so good, I think I'll open a restaurant so I can share my recipe with everyone," or "My mother's fried chicken is the best in the world. I need to open a restaurant so the rest of the world will know" or "I love to entertain. I want to have a dinner party every night with my patrons."

Sam Kandel

I've heard it so many times: "My chicken parm is so good, I think I'll open a restaurant so I can share my recipe with everyone," or "My mother's fried chicken is the best in the world. I need to open a restaurant so the rest of the world will know" or "I love to entertain. I want to have a dinner party every night with my patrons."

Sound familiar? The reality is that the restaurant business is brutally hard work, notoriously unpredictable, frequently unprofitable and more often than not a losing proposition.

Don't assume just because you're a good cook that you have the skills necessary to run a successful restaurant. There's a big difference between cooking a good meal for your family or maybe a family gathering, and serving an impatient mob of restaurant patrons who want everything all at once prepared to perfection, every time.

If you think that "mise en place" (Google it!) is a quaint square with a fountain in the south of France, then you should probably reconsider your aspirations!

As with any business, running a successful restaurant boils down (no pun intended) to the numbers. Firm control of food, beverage and overhead costs is critical in a business with slim margins and a heap of unpredictability. One week your place can be the talk of the town, and then a competitor opens up down the street, and all of a sudden you're turning your tables once instead of twice on Saturday night. A couple of negative reviews on Yelp or TripAdvisor can send your sales into the proverbial " -- well, you know!

Maintaining market share will be a function of establishing a regular clientele, satisfying their expectations, always keeping them interested and doing it profitably every day. Never lose sight of the fact that you are in the people business. It's not about you. It's all about them. It sounds like a cliché, but the customer is always right.

If I haven't talked you out of it yet, know that, on average, 80 percent of new restaurants fail within the first five years. Before you put on your chef's whites, adjust your toque (Google it!), sharpen your knives and start dicing, consider the real risks of the journey you are about to embark on.

And then there are the 20 percent who do survive!

Sam Kandel is a certified business adviser for the Mid-Hudson Small Business Development Center. SBDC columnists appear on alternating Mondays. The SBDC offers no-cost, one-to-one business counseling to new and existing businesses. For more information, call 339-0025, email sbdc@sunyulster.edu or go to mid-hudson.nyssbdc.org.

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